Transcription

Leading in Crisis

When things are going right, it's probably easy to demonstrate leadership skills. But when things
go south, probably every competence of the leader comes into the limelight.

Leading teams, emotional intelligence, self-awareness, conflict management, team dynamics,

decision making, all of them become absolutely pertinent.

Covid -19 absolutely turned the world upside down. We were faced with never before
understood variables, decisions we'd never taken before, thoughts and actions which didn't cross
our minds earlier.

Well, those leaders who truly shone out, in the times of crisis are the ones who are going to write
the next wave. So when we talk about leadership in crisis, we're talking about the core strength of
a leader, surfacing at that point in time and affecting every momentous decision.

Captain Sully once again and as an example, is leadership in crisis. That split second of a decision,
made a world of difference, the difference between life and death for all the passengers on board.

In fact the behaviours of so many others, including the example we took earlier of Jacinda
Ardern, the prime minister of New Zealand in times of crisis. Look around you, even in your
homes, in your neighbourhoods, you will see extraordinary behaviours of leaders during times of
cris

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I wish I could just have my life back: Tony Hayward, 2010 Deepwater Horizon. The statement led
to his downfall, replaced by Bob Dudley. What did he say and what does this indicate about
leadership in times of crisis?

An absolutely unempathetic statement that reeked of selfishness and the inability to assess the
damage that was done as a result of your organisation and company.

Leadership in crisis is not just about the leader's behaviour, to resurrect the organisation, it's also
about understanding what the world has to say about you, how do you mitigate the risk that has
arisen, how do you fix the public image, how do you ensure that your genuineness, the fact that
you care, the fact that you're making changes and you're fixing the problem is conveyed to
everybody who's a stakeholder in the matter?

Well, leadership in crisis has an important role, particularly when it comes to the public image.
What is the kind of action that you are taking? Are you able to tell people that these are the steps
you have undertaken to fix the problem.

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Again case in point, Jacinda Ardern and when she addressed the parliament, she was very clear
and transparent about what she plans to do for the nation, in order to avoid such a similar crisis.

In fact, Brian Chesky's email to every Airbnb employee or Toyota's recall of their cars, each of
these is a fabulous example of leadership in crisis, particularly when public image was hampered.

It demonstrates what a leader does, how a leader communicates, what a leader needs to know
and understand, particularly when handling crisis, so the organisation and the external
ecosystem is not left guessing.

To truly fathom, whether the leader cares or doesn't. Well, in fact, that one statement that Tony
Hayward did, actually became the headlines and every other action of his, was put in the same
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light, this is a CEO who doesn't seem to care. This is in stark contrast to what leadership in crisis
should look like.

In times of crisis, what are some steps, a leader can keep in mind to mitigate the kind of damage
that is done? So what are some steps in order to rebuild the public image that might have been
damaged as a result of a crisis with the organisation?

It begins with accepting and acknowledging that there is a problem.

Number two, apology. There is no shame in apology. In fact, apologies demonstrate vulnerability
and courage. It shows compassion. It shows that you care.

Number three, transparency about the extent of the damage done and the steps the company
wishes to undertake in order to fix the problem.

Number four, updating the general public and all stakeholders on what has been done from time
to time. And eventually, last but not the least, delivering on every single promise made. All of
these need to be demonstrated both in spirit and action.

Compassion is a key, empathy is a key. Eventually, if the whole world looks at the steps you are
demonstrating as slip service and not really in spirit will defeat the purpose.

We've not just shattered the trust of our stakeholders in times of crisis, particularly if it has
damaged their hopes and their aspirations, but by not adhering to the spirit of the commitments
we'll make, we're ensuring that our future is also gray.

Following these steps, is absolutely pertinent and important to mitigate the risk and to ensure
that we can fix the damaged future of our organisations.

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I think crisis and dealing with crisis is important and very relevant in today's age because I would say
25% of the crisis are real crisis as per the Oxford dictionary and 75 are crises that are self-created
but good way.

Why? Because today in the 21st century; the competitiveness, the speed to market, the ability to be
able to stay in the lead, the element of hunger for growth, you know how I attract people will depend
on what is my positive story.

There's a natural momentum which converts into pressure; I mean some people look at it as
pressure. Some people look at it as stress, some people look at it as momentum. I look at it as
momentum but for a lot of people my momentum may be pressure and for 50% it would be stress.

So, when you look at that parameter there and you say that if you want that momentum; how do you
deal? This is a self-created crisis. If I want to grow at 100%; that's not a crisis but it is a self-created
crisis for a lot of people there because can we grow at 100%? Is the market big enough to grow at
100%?

Am I cannibalizing from my competitors or am I building the market? Do I have the right budget for
it? Have I spent the right kind of marketing, the people, the cost, all the support systems?

So the very fact of an enunciating of a very positive statement like I want to grow by 100% can put
the company in crisis versus I've run out of money and I've got to solve a crisis or a government
regulation change and I'm out of business because they're just redefining the businesses you can't be
in this business or whatever else you know or literally we're in a factory but the whole factory
burned down or whatever those - that's a different kind of a crisis where there are things outside of
your plan control that hit you which you may not have with your best planning also pre-empted.

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That's a different crisis but 75% of the time people are dealing with a crisis of natural peer pressure
requirements and I'm saying it doesn't mean 100% growth is not the only answer to a crisis could be
many other things; speed to market on a product when you know three other people are making the
same product can be a crisis for an organisation.

Competitive pressure can be crisis for an organisation, losing three key people. You know even a
3000 people sometimes can be a crisis for an organisation. So geographical reason can be a crisis for
an organisation.

So how you deal with both these? So firstly, distinguishing between these is most important. So,
question is: if the factory is on fire and it's burnt down; how do I deal with that situation right? So
obviously, at that stage you would have thought it through.

Most people have that good companies that are well run have a plan. Clearly, the minute I have a
factory, that's making a hundred thousand spectacles and I ran a toothbrush business long time back.

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There was no reason for me to have a plant in Maharashtra, in Gujarat, in Karnataka and in Assam
but we did. It was not a growth plan; it was for two reasons. My first reason obviously was location
symmetry but the second one was at no stage will 25% of any product come out from any one plant
and we had eight customers.
The idea would have been to divide the factories into two-two customers each but I divided up into
50-50 percent where no one customers output would come from one factory. So, I dealt with any and
all natural disasters, natural calamities, a fire, and a labour issue but it could be a raw material issue
also.

So, when you do that planning you're eliminating almost that in Maharashtra supposing the road was
blocked and there was an Octroi or a GST strike and no raw material is coming to here, I still have
working.

So, this is one. Everything if it's planned in that manner would have a certain amount of provision? I
don't think anyone who's a leader would not think what if we ran out of money; there would not be a
situation where I never thought about that.

I mean that would be absurd for someone who said I never thought of such an eventuality because
these are eventualities that do come in and that's why for the people who plan even a global
pandemic where it's not just, I did all the geography solutions and still Murphy's law prevail.

You'll come out a bit faster than anybody else; on the other part of crisis, don't look at it as a crisis.
Align yourself that are you excited about this goal? If you're not you're going to be stressed and
therefore you look at.

It's a total crisis, my boss woke up and said I wanted to would grow by 100%. I'm in crisis mode or I've
got these deadlines to meet where I'm never meeting, I'm in crisis mode. Self-Made crisis.

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In times of crisis, a leader will also be faced with decisions that might probably increase conflict.
Thomas-Kilmann has suggested different styles to manage conflict.

A leader could choose to probably avoid the conflict, often called the Ostrich Effect, where the
head is sunk under the sand, assuming the problem to go away or a comparative style, where it's
pretty much my way or the highway.

The accommodative style, which indicates that maybe the leader gives in too much or is it the
collaborative style where at some point in time, you're always looking at a win-win situation.

In fact, does a leader have a compromising style, which means, I give up - some you give up some.
These conflict management styles will also create the tone in the organisation. Primarily, because
team members will understand, whether conflict is valued and recognised, or it is suppressed.

Remember if there is no conflict, there will be no responsibility and accountability, because

nobody has a skin in the game.

I think one of the big things when you feel you can even manage conflict is what is the level of respect
you have from your colleagues?

That's your first opening balance account; it's like your bank account. You can't have a conversation
with anyone; if you don't have money in the bank by saying I want to do something with you right.

So, it is an opening balance. Your opening balance on anything to do with conflict will mean. Is the
other person looking at me with respect or is he any way thinking about this person because you can
resolve conflict when both people have mutual respect and both people have a sense that I may not
agree with this person, but I do know that he talks sense.
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So, this is a very important element of building your reservoir first; that when you want to get to any
conflict management; it doesn't have to be conflict. Sometimes you may consider it conflict; it's
actually argument.

So, the first part is what is the reservoir you have with those people where they have a respect to
your opinion because then you can resolve conflict management very differently.

The second one is who are the two is looking at is conflict versus clarificatory versus problem
solving. Having different points of view is one of the best places to start with. It's not the worst place
to start with.

So good conflict leads to great dialogue that actually leads to a possibly better thought decision than
anything else.

But if conflict and conflict and both have to withdraw and go to their own sides and form their own
conclusions then you haven't resolved the conflict and you're both the losers; because you neither
got the benefit of the other person questioning you because you were so - This is not a debate. You
don't have to win a debate; it's not a point you're making.

When you learn debate in your school and your colleges; it you just most people didn't win a debate.
It was how forcefully you stayed with your own point. Now, that is a good learning but it's also a bad
learning.

Because what debating taught me was good this thing but it also taught me that I should just keep
sticking to my point.

The best debates are when you say this is a very good point. Now, let me address what I was thinking
with this point, which most people don't think in debate because the thing is but I'm taking sides.

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So, the minute you understand that conflict is not about taking sides; it is about getting to a better
resolution. You look at things very differently and the second is both people need to feel that I'm
talking to somebody whose opinion I do respect. So, when we're having this argument; I may walk
away from here uncomfortable or unsatisfied with a discussion or maybe not even an agreement but
I do think he's got a point.

I think that's the best way to do that. Build your reservoir, build the respect. Look at conflict
management as listening, not debating, not winning, not retreating but having a better decision and
to me that's the best way to resolve conflict and look my learnings have been at different stages
because the conflict resolution for peers is different from a conflict resolution with your boss.
It's different from a conflict resolution for people who report to you or who reports you reports to
you down there or a CEO of a company; they're all different levels of conflict.

One, then there's a conflict level with a consumer. The consumer is always right. You don't want to
pinpoint that but you do want to improve their experience. You do want to point out to them that sir
while this is there and you do have a warranty period, I just want to tell you and set your
expectations right and sometimes the conflict will be this time around maybe you didn't understand
it.

So, let me satisfy you totally but sir before I put the phone down; let me set your expectations of
what this warranty means for the rest of the life of that product.

So, dealing with conflict; you need to understand who you're interacting with and your tonality has
to change or your homework has to change.

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When we talk of conflict, one needs to understand that there will be difficult conversations, right.
In fact, difficult conversations are probably a very critical element, of ensuring trust and
transparency in an organisation.

A lot of us shy away from having that difficult conversation, with our parents, with our children,
with our friends. It creates discomfort. We fear about the impact it will have on others. We’re
worried about the strength of our relationships or maybe even the perception the individual will
have about us, should we give negative feedback.
However, difficult conversations can be beautifully navigated, by leaders who are completely
self-aware and have empathy. The focus needs to be on the issue on hand. The focus should be on
the specific behaviour or crisis or situation that needs to be described.

When we look at providing feedback in an extremely generic term: Probably pushing the person
to the wall, we’re bound to get a negative response.

Instead, here is a framework for difficult conversations. My story, your story, our story.
Essentially what that indicates, is when you start having a difficult conversation, you are talking
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about your perspective, your opinion, the information you possess and your views. What are you
trying to say, your part of the story.

Your story is when you invite the person you are having the feedback or the conversation with, to
present their side of the story. What are their thoughts, their feelings, their reasons for
behaviour, their drives, their ambitions, probably even certain excuses or reasons that they may
wish to share with you. It’s their perspective and their prerogative to share.

However, the end is what matters, which is what I term: Our Story. You may choose to disagree or
you may choose to agree. Eventually, a summary of both sides of the story, needs to be compiled
and that is called 'Our Story'. The Our Story essentially sets down a plan of action.

What are we deciding as a course of action as a result of this difficult conversation? Eventually,
there are consequences, there is an impact. What is that impact and what is the consequence?
What are we choosing to do as a result of this conversation that we’ve had?

A difficult conversation should eventually surface the tension that is underlying. And, a great
conversation should actually create alternatives or course of actions, a point of decision.

So, I think look this is a very important point because you're talking about tough decisions and you're
talking about leadership.

So, first thing I want to do is an audit because you're a leader by default because five people are
reporting to you or 15 people are reporting to you. That doesn't mean that you are capable of taking
tough decisions.

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Okay, 99.99% of the people mix up that I have to take - Our leaders have to take tough decisions. You
don't; you became a leader just because 10 people are reporting to you. The real tough decisions is a
real key mark; so the main point is you're not a leader.

You are; you 10 people report to you and I think we mix up I'm a manager. That's because 10 people
are now reporting to you but you become a leader when you communicate right; you're a leader
when you're evolving that; you're a leader when you can resolve conflict management.

Similarly, you're a leader when you can solve for this; that is the most important part. Tough
decisions appear tough to people who don't - who can't make them because if I have to let 300
people go and shut a company by definition it's a tough decision.

Okay, but there are - 90 percent of the tough decisions we make are actually not even tough
decisions. They are obvious decisions that have short-term, medium-term or long-term gain and
sometimes they have a long term but not a short-term gain.

But you need to take them. So, I think the very fact that you think its tough means mellow it down
because it's actually not that tough. It sounds like it's a visible thing. The best litmus test for a tough
decision is – is this the right thing? Will I regret it tomorrow? If I don't regret it; that's what I need to
do?

Now, it's about how you communicate that? Justifying a tough decision is weakening your
leadership; completely and totally because of the simple reason that explaining it, communicating it,
giving the entire trend of thought; if it was a really tough decision, I would take 20 minutes to explain
to people.

You know for the last three days I've been grappling with this. These were my three pros. These were
my three cons. Then I weighed that out and I came with this conclusion.

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Okay, I decided that as a EdTech company, should we get on to IPL or not? Compelling reasons why I
would be able to build the brand? Also, compelling reasons why it'll change my profitability of the
company for this quarter; compelling reasons that it'll have long term benefit.

Non-compelling reasons that it may not have benefit for almost a year; compelling reasons that I will
be able to brag about my brand because so many people. Non-compelling reasons because I found
nobody in the organisation wanted to take ownership for this expenditure to be on IPL.

It was all a feel-good factor. Six points, three pros, three cons and tough decision making. Now the
point is I finally take a call? No, I don't want to be on IPL.

Here's the question right now. The question is I can't go justifying it. I just explained it to you. I didn't
justify myself. I gave you three pros. I gave you three cons. You've already got where I was coming
from. I didn't even have to tell you what I was deciding on.

You got from my pros and my cons that actually for Ronnie it is not a tough decision but I can
understand for somebody else it would be a tough decision because the way he thought it through;
so, the way you think it through if you can transparently share that with the people who matter, then
pause, and say this is what I thought but at this point it is my final - I'm still happy to have a contrarian
view from people; invite the contrarian view but not a contrary view that by the way I've decided
this.

Then there's no contrarian view. The person will say but I disagree with you. Then the conversation
ends but when I've had this conversation here in this manner; the points will be you think the cons
outweigh the pros. I think the pros outweigh the cons for this reason.

Then you can have another 15-minute conversation by which time the other person is also
converted. And finally, I see your point, I see your point and we move forward. That's what it's about.

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Culture ate strategy for breakfast, a very popular statement. In my decade-long work on
organisation cultures. Culture is a sum total of the employees' behaviours, attitudes and
perspectives towards work. It's about the sum total of our behaviour.

In fact, the one distinguishing element, in those companies that do fabulously well, is their
culture.

How does culture create crises and what can a leader do to ensure that team members
understand, respect and contribute to building cultures? Let's begin with understanding what are
some of the reasons that culture may not thrive?

Well, the way we all individually come from different backgrounds, it's the same thing that works
in an organisation.

People bring in their past, their experiences, their beliefs, the way they're nurtured, the way
they've grown in other organisations and bring forth similar attitudes and behaviours to the new
places of work.
Sometimes it can cause a conflict of interest. Patterns of behaviour may be different, attitudes
differ. When this happens, it's a leader's role to enforce the right set of values and principles and
create a uniform generic culture.

It's interesting to note here, that different pockets in the organisation may have different forms
of cultures, but eventually they all need to contribute to one DNA of the firm.

How do you build culture and what can a leader do? Edgar Schein has shared a fabulous model for
us to follow. He believes that it all starts with a basic underlying assumption.

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What do you stand for, what's the purpose of the company? What's your basic rezone deathtrap?
This can then be built up with understanding what are some of the espoused values. What are the
do's and don'ts, the guardrails of your behaviour?

And finally, what are the artifacts, the signs and symbols that indicate the thrive of your culture?
What is the way you want to be known? What are some of the signals that you give out to your
employees and to the outside world, what does your brand look like?

Is at all in synergy with the values and your basic underlying assumption? A culture gets built
over a period of time, but if a culture starts disintegrating, the ripple effect will be tremendous.

The cracks will show up in more ways than you can imagine. A leader has such a concrete role to
play in building the culture of the organisation.

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So, I think culture is really set from the top; so, if you're a leader but not the absolute top, it is difficult
for you to say that am I going to be able to set the culture.

Having said that, I've seen incredible situations where even when we had a large media company for
example and then we had a broadcasting division and an animation division and a movie making
division and a special effects; each was one was more technology heavy, one was more sales heavy,
one was more creative heavy, each of these but within those you can still have slightly different
cultures.

It's up to the leadership to create a common culture but just because I'm a manager of 25 people out
of 2500 people. How can I have a 25 people culture you're right? It would be incongruous and not
correct for 25 people into 100 different cultures in an organisation but within that 25 people the
subculture can be incredible and I'm calling it a subculture because there's certain things of how this
group responds, this group is proactive, this group is looking over not just in their own; not blinkered
down but looking out.

This job is helping and helping with other people. This group, that says if I make a target, I'll meet my
target; you can create those that doesn't need to be an organisation culture.

If you feel that there is politics in somewhere else you will have to deal with that; so, you can actually
even if you're not at the top; build what I would call subculture which can be very good for your
leadership style because if that is noticed, the first thing I would see if somebody is doing that in the
group of 25. Pick him up and make him a group right there and then make him a leader for 250
people not HR leader but a leader; not HR leader but a leader.

The simple answer to building culture is creating from the front and leading from the front but
mostly being that person yourself and then seeing that the next 10 people are also in that same
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mould of the what we all believe in okay and that is very difficult to do because for that leader at the
top to be that personality but define a culture that is not her or him or that of the 10 people is not
going to translate into a really good culture.

Toxicity is a context where there's enough friction that is not managed into positive friction. I think
people having friction is very good because it keeps people on their toes; not from a comparative.

I think internal competition is important. That's a good culture to have but it can get easily bad
because everyone's very competitive and then they’re lost in that that's the job of a leader to be able
to do that.

That doesn't mean - yeah but this is not working out; so, I'll drop competitiveness and everyone gets
passive. I'm not looking over anything else. I'm just looking at doing my own thing; I'm not getting
that sense because most people in growth for example today, it comes because if you're just a single
sector; if you're a single player in a sector- you grow but you're never growing because you've not
got that peer pressure because you don't have a benchmark.

So, then you keep making your own excuses. Okay, the market is growing like this - then one fine day
somebody comes in, overtakes you then you feel okay.

So, similarly, here I think in a culture, it's very-very important that at the leadership level and at the
top level, there's no double standards and double standards is not easy to not do. Whereas look, I’ve
met with 100 people. We designed this. These are the five cultures; I’m not three of them.

That doesn't mean I'm a bad person, I'm just not three of them. Then it's a little incongruous and
therefore it's sometimes important that you need to be very clear. The top 10, 20, 30 people need to
have no double standards when they're saying this is how you want to do?

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If the objective is younger people should grow then younger people should grow. If you think all
talent should be respected - if I'm a non-hierarchical organisation what does that actually mean? It
means anyone can say something and their view could be taken into account not to be mixed up with
everyone can say everything.

Not to be mixed up with insubordination. If you're talking about a non-hierarchical organisation

means you can't say nobody will get double promoted because then it's a hierarchical organisation.

What you mean I can't get out? I’m super smart, I just showed you that I am 25 people; we have a
toxic culture when my 25 people look at my culture. Now double promote me because I can lead
better people. I can look at the culture I created. I would triple promote it. So, there we need to be all
aligned in a particular manner.

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Disclaimer: All content and material on the upGrad website is copyrighted, either belonging to upGrad
or its bonafide contributors and is purely for the dissemination of education. You are permitted to access
print and download extracts from this site purely for your own education only and on the following basis:

● You can download this document from the website for self-use only.

● Any copy of this document, in part or full, saved to disk or to any other storage medium may only
be used for subsequent, self-viewing purposes, or to print an individual extract or copy for
non-commercial personal use only.

● Any further dissemination, distribution, reproduction, copying of the content of the document
herein or the uploading thereof on other websites, or use of the content for any other
commercial/unauthorised purposes in any way which could infringe the intellectual property
rights of upGrad or its contributors, is strictly prohibited.

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separately for unauthorised purposes.

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